More information on Four Corners’ research with Webster Ltd and the MDBA

Posted 10th July 2019

Share

In preparing its investigation Cash Splash, which aired on Monday 8 July, Four Corners wrote to Webster Ltd on 22 May to request a background briefing, an on-camera interview and the opportunity to film some of its operations for our program.

In that email, we clearly stated the scope of our investigation:

“Our story will be looking at what’s next for the Murray Darling Basin, following the weekend’s election result, the SA Royal Commission, the Matthews report and recent public concern about issues including buybacks and water management. In part, the story will look at the MDBP’s efficiency infrastructure grants and explore the arguments for and against this program. We’re also interested in looking at the changing face of agriculture in the Murrumbidgee, given it’s the most developed valley in the basin. We’re speaking with a number of farmers and businesses in this region – we understand that Webster has several large plantations/farming operations in the area and would be interested in hearing your perspective on water use, infrastructure efficiency grants and farming in 2019.”

Our researcher called Webster several times to seek acknowledgement that the company had received our email. She was then told on the phone by a Webster spokesman that CEO Maurice Felizzi would be available for a background phone conversation at a prearranged time. When we did not receive that phone call, our researcher again called the spokesman, who said Mr Felizzi would be unavailable but would get in contact via email.

On 24 May, Mr Felizzi wrote via email to Four Corners that the corporation had “no intention of facilitating your objectives”. He declined “access to Webster’s people and facilities for briefing or filming” and offered to answer questions in writing. In his email, Mr Felizzi accused Four Corners of having “a strongly held bias against irrigation and business, without regard to the facts” and of reporting “deliberately false and misleading propaganda”.

In this email, Mr Felizzi cited a previous Four Corners program, Pumped, broadcast on 27 July 2017, which it claimed was riddled with “fabrications”. Mr Felizzi referred to a document entitled “ABC 4 Corners Fabrications”, which Webster published in July 2017 after Pumped was aired. Four Corners rejects the assertions in this document.

Pumped was a landmark program which led to charges being laid against several individuals in relation to water theft and prompted the SA government to call a Royal Commission into the Murray Darling Basin Plan. The program was also nominated for a Walkley award and a Logie award for outstanding public affairs reporting.

The SA Royal Commission focused in part on the irrigation infrastructure “efficiency” grants that account for $5.6 billion of the MDBP’s $13 billion expenditure of taxpayers money. These “efficiency” grants were the focus of this week’s program.

In its final report, the Royal Commission was highly critical of the so-called “efficiency” grants, describing them as “a very expensive means of recovering water for the environment… an extravagant expense… (and) an improvident policy choice by Government for taxpayers”; “a quintessential example of a sorry lack of accountability and transparency”; and “a decision based almost entirely on political considerations”. It said persisting with efficiency measures “defies logic and common sense, and is fiscally irresponsible” and recommended a full a complete audit of efficiency measures because “no such transparency or disclosure has existed despite the fact that the money being spent is public money”.

The findings of the Royal Commission provided part of the basis for this week’s program, which included an interview with Richard Beasley SC, who was Counsel Assisting the Royal Commission. His assessments were supported by a raft of other esteemed experts.

On 2 July, six days before the air date for the program, Four Corners sent a list of questions to Mr Felizzi. It is normal procedure when written questions are submitted to send them about one week before broadcast. Research, scripting, production and fact-checking of the program were still underway at this time. Given the company had already (aggressively) declined to assist with the program or to be interviewed, allowing them six days to respond to eleven written questions was more than ample.

In his emailed response to our questions, Mr Felizzi included information that was inconsistent with information the corporation had provided to its shareholders in its 2018 annual report. So Four Corners again contacted the company to seek further clarification.

For example, Mr Felizzi wrote: “Webster has not increased its irrigation footprint on any of its properties as a result of the OFIEP funding.” In addition, he wrote that Webster had received a net amount of $18.8 million taxpayer funding under the Murray Darling Basin Plan’s on- and off-farm irrigation efficiency grants. He also wrote that the OFIEP and PIIOP funding had paid for a portion of a $78 million development program, which was carried out in the past three years.

Some of this information was inconsistent with the annual report, which stated, for example, that the $78 million capital works program on Webster’s Kooba, Bringagee and Hay properties would increase irrigable land by 8,100 hectares and increase the volume of water stored by the company by 30,000 megalitres.

Seeking to clarify the inconsistencies, our reporter called Mr Felizzi on Friday 5 July to ask further questions about the sum of money Webster had received from the taxpayer. During our phone conversations, he corrected some of the details included in his written response.

For example he stated that Webster had received a total of $41 million in funding under the water infrastructure scheme, not $18.8 million. He said that $22 million of the total amount received was the value of the water entitlements that Webster had surrendered in return for the funding, which the company had not included in the dollar value provided earlier in writing to Four Corners. In relation to the apparent contradiction between his written answers and the information provided to shareholders regarding irrigable hectares, Mr Felizzi said that irrigation for wide fields had been converted to cropping irrigation.

Our reporter explained that Four Corners would be relying on the information contained in the annual report unless Webster intended to inform shareholders that the information provided to them was incorrect.

The information provided by Webster in its written statement and telephone briefing was incorporated into the program, insofar as was required to ensure accuracy, fairness and balance. For example the program cited the $41 million figure provided by Mr Felizzi, and included the line: “Webster says it has acted at all times within the government’s guidelines and that the projects have been independently audited.”

Four Corners had two briefings with the Murray-Darling Basin Authority: A half-hour briefing on 5 June on the water market and a longer, wide-ranging one on 19 May. During the 19 May briefing the MDBA representative emphasised it was not responsible for the infrastructure scheme – which was the focus of the program – and said questions about it should be directed to the Dept of Agriculture and Water Resources. Therefore we did not request an on-the-record interview with them.

*This statement has been updated to include the “Cash Splash” air-date and the information on Four Corners’ contacts with the MDBA

The ABC has grown remarkably since it launched on 1 July 1932. This is a snapshot of our achievements, programs and personalities and celebrates the ABC's contribution to Australian life for more than 80 years.